This Week In Amazon: Buyer Beware On Prime Day

Prime Day Hits Pay Dirt

Prime Cut: Prime Day, next week’s big 36-hour sales event and hype fest for Amazon’s Prime membership service, is getting more expensive. Not for consumers of course — deals are expected to rival or surpass those on Black Friday — but for third-party Marketplace sellers who wish to participate in the e-tailer’s “Lightening Deals” flash sales.

TWICE Take: Sellers could offer the limited-time promotions for no additional charge during the first two annual Prime Days, but Amazon changed that up last year by imposing a $500 registration fee per deal, and hiked it up to $750 for next week’s go ’round. Analyst Sean Adams with the marketing agency Merkle says the purpose is twofold: generating more cash for Amazon (natch), and weeding out weaker product promotions from less confident sellers.

Prime Day Primer: Buyer Beware

Prime Cut: Amazon is promising over 1 million deals for next week’s Prime Day sales event, up from 100,000 just two years ago. But a study by pricing analysis firm Market Track found that retails on some 800 randomly selected items including TVs and wearables were, on average, only 0.8 percent lower than the preceding 50-day average, and were actually 0.3 percent higher than the following 50-day average.

TWICE Take: Similarly, e-commerce analytics firm Profitero found that about half of the products it tracked during Prime Day week were priced higher than the month before. So what’s a Prime member to do? Market Track says the very best deals will be available exclusively via Alexa, to help train customers to shop by voice, while market research firm eMarketer advises that there’ll also be discounts aplenty on Amazon’s proprietary tech, including gadgets from recently acquired smart-home brands Blink and Ring.

Toto, We’re Not In Redmond Anymore

Prime Cut: If it’s starting to look like Microsoft headquarters around the Amazon water coolers, that’s because it is. According to salary analysis firm Paysa, the e-tailer poached at least 30 senior-level executives from the software giant between 2015 and 2017, more than any other tech titan.

TWICE Take: Why the exodus? There’s Amazon’s close proximity to Microsoft, plus the critical need for more managers as CEO Jeff Bezos more than doubled his employee ranks to 577,000 during the same period. But there’s also the wow factor of working at Amazon, which is seen as “more exciting, more at the edge,” said Wharton management professor Michael Useem.

Honor Thy Customer

Prime Cut: Amazon has established itself as the world’s No. 1 e-tailer, but it also has another top achievement under its belt: America’s most reputable large company.

TWICE Take: For the second consecutive year Amazon led The Harris Poll’s annual reputation ranking of the 100 most visible U.S. businesses. While President Trump might differ, 25,800 respondents said Amazon’s the bomb on five out of six criterion: products and services (No. 1); vision and leadership (No. 2); financial performance (No. 1); workplace environment (No. 10); and emotional appeal (No. 1). The one area it bombed out was on social responsibility, where it didn’t even make the Top Ten.

Voice Of A New Generation

Prime Cut: Many consider Amazon the most disruptive force in business today. But according to CRM industry analyst Brent Leary, the company, and its pervasive virtual assistant Alexa, may be leading the voice-control category into even more disruption.

TWICE Take: Leary argues that the frequency and variety of new Alexa-based Echo additions is accelerating change in consumer behaviors, expectations, activities and even temperament. Layer in Amazon’s 100-million-strong Prime membership program and a national brick-and-mortar chain in Whole Foods, and you’ve got an ecosystem and platform that are working together, feeding off each other and driving a new generation of voice-first consumers.

Amazon Quote Of The Week

“As with any large promotional day, you’re going to get a combination of legitimate doorbusters designed to draw in shoppers and some deals that are more about clearing out inventory.” — eMarketer retail analyst Andrew Lipsman, on next week’s Amazon Prime Day